start up costs

[POCAHONTAS]

client buys equipment to start business but the partner runs away with the equipment and the money, can that be a deducted? I was told that it can be deducted as start up costs on form 4562 but according to the ttb these costs don't seem to qualify?

am I correct???

thanks

[MAJ]

Start Up Costs?

My quick answer is Yes, but there's a few questions I'd want to clarify.

1) Does the remaining partner have any proof (of anything)?
2) How do we know that the other partner isn't claiming everything stating this partner is the one that left?
3) Who has the receipts for the equipment?
4) Who has the equipment?
5) Was there any type of agreement between the two parties?
6) Who's name is/was the checking account in?
7) How much money are we talking here?
8) Who put the startup costs in? Is there any proof?


Good luck...

[Snaggletooth]

What Kind of Costs

What Kind of Costs prior to "official" opening of a business may be deducted without having to be classified as "Start-up Costs" and amortized accordingly?

[POCAHONTAS]

snaggletooth

do you mean capital costs or do you mean amortizable start-up costs that could be deducted if they were paid or incurred to operate an existing business. See this is where my confusion begins.

the other partner ran away with all the equipment, and the business never really began or at least the partner left with nothing did not have any income from the business so can he really deduct his cost as start up cost. The partner left with nothing has all the receipts of the costs incurred, so therefore since he has the receipts can he still take the cost as start up costs.

I hope I made some sense
thanks